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What is a financial advisor, know their functions?

If you are thinking of investing and you are not sure where to start, we are sure that you have considered seeking help so that everything goes as you would like. And that help is what a financial advisor will give you. But what is a financial adviser? What does a financial adviser do? How will he know what exactly you need?

We are going to see in detail what a financial advisor is and what he does, as well as the qualities he must have to carry out his work in the best possible way.

What is a financial adviser?

Financial advisors, according to the EFPA (European Financial Planning and Advisory Association) are "those people in charge of helping their clients, with exhaustive knowledge in finance and capable of finding the product that best suits their needs."

In other words, they help us find financial solutions that are completely personalized to our risk profile, past, present, and future life situation, age, assets, work, and family situation. They usually work in companies that are linked to the stock market, stock market, investment, insurance companies, etc.

What is the role of a financial adviser?

Depending on where the financial adviser works, their duties will be different.

Functions of a commercial advisor in a bank

In the case of the profile within a bank, as you will see, the name becomes "commercial advisor", since its functions will be the following:

  • Management of funds marketed by the bank for which he works, as well as finding new business opportunities.

  • Acting as a commercial with the clients of the entity to advise them through the products of the bank.

Functions of a consultant in a company

Within a company, a financial advisor will be in charge, among other tasks, of:

  • Act as a consultant in making investment decisions for the company.

  • Search for ways and tools when increasing the capital of the company.

  • Earnings advisor.

Duties of an independent financial adviser

An independent financial advisor has an obvious particularity with respect to those who work in companies or bank business advisors: they do not take a commission on the products they sell, but it is the client who hires them who pays them for their advice...

Therefore, its main functions are:

  • Study of the profile of each client, collecting all the necessary information for it.

  • Advice on investment decisions, as well as developing different strategies in this regard.

  • Research the market and its conditions.

  • Offering the best investment products by the profile of each of its clients.

  • Accompaniment throughout the relationship with your client.

  • Promote the achievement of the financial objectives set with each client.

Of course, we must not confuse a financial advisor with a financial agent. The difference between a financial agent/analyst and a financial advisor is that the former gives a more macroeconomic vision compared to the advisor, who is more focused on the microeconomic part, of specific personal assets.

Qualities of a financial adviser

Finally, we are going to see the different qualities of a financial advisor that will make everything go smoothly.

1. Objectivity

Among the qualities of a financial advisor, one of the most important is objectivity. Keep in mind that, as we saw previously, it has nothing to do with a commercial adviser from a bank, who will logically try to sell the financial products of the entity. A financial advisor will always be objective and independent in order to offer you exactly what you need based on your needs.

2. Communication

And for this to be possible, an adviser must be communicative: just like you must be. Communication and trust between advisor and client are essential as long as the professional relationship is maintained so that everything “runs smoothly”. In short, your financial advisor should be communicative, sincere, and open to dialogue; exactly like you.

3. Availability

Another very important point within the characteristics of a financial adviser and related to communication is availability. Your financial adviser must be available to help you answer any questions or attend to any request.

4. Certification and professionalism

A good financial advisor must be a professional in the sector, not only in terms of tax and finance knowledge but must also be officially certified.

The National Securities Market Commission (CNMV) published a list of valid accreditations to certify the work of a financial advisor. Obtaining the EFA certificate, for example, certifies that the financial advisor has extensive knowledge in financial planning, being certified by the EFPA (European Financial Planning Association).

If at this point, you wonder how much an investment advisor will charge you, the first thing you should know is that contrary to what many people think, it is not necessary to have a very high amount of money for it.


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